Danish Sifi Deal Held Up by Dispute Over Capital, Nordea Says

By Peter Levring -
Apr 19, 2013

Danish efforts to reach an accord
on too-big-too-fail bank buffers are being hampered by
disagreement over the kinds of capital that can be used, said
Anders Jensen, head of Nordea (NDA) Bank A/S’s Danish operations.

“By and large we are there, but some issues remain on
exactly what kind of capital to use in some areas,” Jensen said
today in an interview in Copenhagen. Nordea Denmark also wants
consideration given to the fact the lender can turn to the
parent company in Stockholm, he said.

Banks have until today to comment on measures recommended
by a government-appointed committee to prevent systemically
important financial institutions from defaulting and plunging
the economy into chaos. The committee last month named six
banks, including Nordea, as too big to fail and advised they
hold as much as 5 percent additional capital.

The Business Ministry is taking public feedback before
Parliament considers the recommendations. The opposition
Conservative Party has already signaled it will try to block the
higher capital requirements while the Danish Bankers Association
said the measures would force banks to cut lending and imperil
an economic recovery.